 |
FIGURE 1: BOUSTEAD HOLDINGS
BERHAD LAST 5 YEARS SHARE PRICE TREND
|
**analysis
based on 2017 annual report.
1.
GENERAL INTRO: This counter core business: (1)
oil palm plantation, (2) property development and hotel operation, (3) generic
pharmaceuticals manufacturing and distribution, (4) ship building, repair and
maintenance, (5) Affin Bank and (6) BHP petrol stations.
2.
NOTABLE POINTS:
a.
the 2017 report show good earnings due to sale
of (high development potential) plantation land 678 hectres, the received fund
is applicable to purchase 11,600 hectres land at another location, considerably
increase land available for oil palm plantation. The proposed purchase of land
is in close proximity to existing estates, which increases overall economies of
scale.
b.
employing efficiency enhancing technologies in
oil palm plantation, including using high oil yield clones of oil palm, use of
beneficial microbes for reducing fertilizer usage, utilise GPS and drone
technologies in field mapping, palm census and monitoring.
c.
other well-known brands products distributed
under this group include Kao (Biore, Laurier) and Cadbury Chocolate. Education
institution include University of Nottingham Malaysia.
d.
BHP Petrol stations number 380 in Malaysia,
contribute significantly to company earnings
3.
IS THIS COUNTER A STRONG GROWTH STOCK?
a.
REVENUE RANGE (million): ~ 10,020 million in 2017
annual report, this is a high revenue company.
b.
SHARE PRICE: share price on decreasing trend in
last few years, decreased from ~ RM3.40 in 2013 to current share price of ~RM1.40.
c.
EARNING PER SHARE (EPS): earning per share in
last 5 years are fluctuating, from 0.8 to 29.2 sen per share
d.
FUTURE POTENTIAL/PROSPECTS: for plantation
segment, palm oil pricing depend on socio-economic factors, e.g. EU phasing out
palm oil usage, India applying increased import tariffs on edible oils
e.
CAPITAL EXPENDITURE (CAPEX): spending on
purchase of new fixed assets is 253.7 million, around 1.4% of total assets.
4.
IS THIS A STRONG DIVIDEND STOCK?
a.
DIVIDEND YIELD: in 2017 report, dividend of 11sen
per share payout declared, amount to dividend yield of 8.03% based on current
share price.
b.
CONSISTENCY: in last five years have consistent
dividend payout to shareholders, however the amount of dividend paid on
decreasing trend, 2013-2017 dividend payout were 30, 26, 20, 17.5 and 11 sen
per share, respectively.
5.
OTHER INDICATORS:
a.
CASH FLOW: cash flow is positive, around 592
million
b.
SUPPORT BY INSTITUTIONAL INVESTORS: there is
presence of 8 institutional investors at top 30 major shareholders list, including
Kumpulan Wang Persaraan, Lembaga Tabung Angkatan Tentera, EPF and few
investment funds and insurance funds.
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